TPS investment could cut energy costs

The Toledo Public Schools (TPS) Board of Education is expected to approve a resolution May 28 that would allow the district to cut its energy costs. The board is expected to give James Gant, TPS chief business manager, the authority to spend $3 million to purchase 26 transformers and control systems to replace its current provider, FirstEnergy Solutions.

“We’ve already moved forward with the bidding process,” Gant said May 17. “What the board will approve is the actual bid. Bids are due no later than [May 22]. The board will say ‘yea’ or ‘nay’ to that bid.”

Gant

Gant said he expects the transformers to cost $2 million and the control system to cost $1 million. The cost of each transformer will vary, depending on its size. Transformers will be custom-built to the specifications of the building they will service.

“Not every school building will get a transformer,” Gant said. “Some do not make sense to do, given where it’s at and its size. I would be surprised if Edgewater [Elementary School] were to get one because it’s a smaller building.” TPS currently purchases its utilities — electricity, gas and water — from the area’s largest sources identified by a consulting firm TPS has under contract, Gant said.

The largest energy companies the district does business with are American Electric Power (AEP) Energy, Duke Energy and FirstEnergy, Gant said. “We’ll revisit all that kind of stuff,” he said. “I think that’s a part of this whole process — to look at all aspects our energy and utilities perspective. We need to make sure that we’re doing that effectively.”

Energy Conservation Program

Ohio school districts can be their own energy providers under House Bill (HB) 264, also called the Energy Conservation Program (ECP), passed in 1985. However, the 129th Ohio General Assembly’s revision of HB 264 in 2012 is what has allowed for projects like TPS’s current planned upgrade of its facilities.

According to the Ohio School Facilities Commission’s website: “The ECP allows school districts to make energy efficiency improvements to their buildings and use the cost savings to pay for those improvements. … The ECP gives districts the ability, in this one limited instance, to borrow funds without having to pass a ballot issue for the authority to borrow. This limited borrowing authority has given districts the ability to save millions in utility bills and operating costs, and all at no additional taxpayer expense.”

Gant said he’s enthused when he thinks about the prospective savings TPS will see almost immediately.

“It does get exciting,” Gant said. “There are so many things we can do from a savings perspective. In regard to energy, our return on investment for our transformers is, on average, 4.6 years. We can divide that [savings] out, and then multiply that for the district, and that’s the savings we’ll realize in the general fund. That’s exciting.

“We’ll start seeing savings from lower energy costs the first year. That savings will go back to paying down that $3 million borrowed from that capital improvement [034 fund]. In 4.6 years, we will have paid back that money in full. Any savings from utility costs after that point will become general fund dollars.”

Gant said it is essential that TPS’ maintenance fund be paid back first.

“When we built all these new buildings [in the past decade], there was a fund set up for the maintenance of our buildings. One of the allowable expenditures we can do with this fund is do things like [purchase] transformers, and what the board has decided — which I believe is a very intelligent thing to do — is to make sure that 034 fund is reimbursed before the general funds starts seeing some of the savings in utility costs.”

Three phases

Gant said this energy conservation project will be completed in three phases. “The first phase is getting the infrastructure in place; the transformers, controls, metering and lighting.

“The second phase is being in a position to make the changes necessary within the district to reduce energy [consumption] in a simple way — things like cutting off lights and/or managing how we do our buildings. That’s going to reduce costs in itself.

“The third phase is then going out to our staff, our students and our folks and showing them how they can help in the reduction of energy [use].

“It’s cost reduction. But absolutely it could be education. If we have the ability, or we do a good job explaining to our folks that this is a reduction [in cost] or a savings to our general fund that could be utilized for other things, I’m hoping that we can get them inspired.”

Transformers

Gant said the first phase will see transformers installed on each school building’s property.

“We’re not talking about the transformers on poles 30 feet up in the air, but the ones in the green rectangular boxes on the ground,” Gant said.

“People won’t see any difference. The transformers will be exactly where they are right now. In the corner of a property, you’ll see a green transformer (large metal box). Right now they’re owned by Toledo Edison. Soon they’ll be owned by us.”

Gant said that during the summer, FirstEnergy will remove its hardware and TPS will install its transformers where FirstEnergy’s previously sat.

“And you know what? I don’t think that they’re unhappy about it,” Gant said. “I don’t think it’s that type of situation. We haven’t received any flak whatsoever from FirstEnergy. I have never heard any issues with that whatsoever. I don’t think this is a hostile situation with FirstEnergy at all.”

“When that occurs and you become a primary customer and we’re feeding electricity directly into the customer’s own transformer, they take the transformer equipment out that belongs to Toledo Edison. They put their own in they had to invest in and now they’re getting fed by the high voltage primary circuit of our system, but they’re still our customer.

“We’ve worked closely with school district to allow them to pay a more attractive rate.

“TPS did not kick us to the curb. This is the type of project that we work collaboratively with our customer. The customer has to make an investment on the front end to install their own transformers, which can be a significant investment, but that investment pays off because the customer takes advantage of a much lower price per kWh for electric distribution service. It puts them on a different rate schedule — a primary rate schedule. But they remain a customer of Toledo Edison.”

Controls

As for the $1 million controls system, Gant said it could probably best be understood if it was compared with how homeowners control their heating, ventilation and air conditioning (HVAC) systems when they adjust the thermostats on their walls. “I think that’s a fair way to describe the system in simple, understandable terms.

“We already have HVAC systems in each building. Controls are just a matter of integrating and programming those systems like you do with the thermostat on your wall at home — being able to see what it’s doing and managing and analyzing information from it all throughout the district on a consistent basis as a group.

“One person can sit at a computer — which is his thermostat on the wall — and say, ‘I’ll get the heat on here. I need to stop the air conditioning here. We’re out of school here so I’m going to stop this HVAC system from kicking out air conditioning at this school.’ The controls system manager can control the HVAC system from the central location and from the building itself, Gant said. “So I can say, ‘All right, Bowsher needs to shut down their air. There’s a problem. I need to reboot it.’ Bam. I did it here and the system reboots at the building. I can do that from a central location. Obviously, I can do it at the school also.

“My thought is, if you did it at a school building, you would probably do it from a computer, too. They might even go into a similar system within just their school, because the system is so integrated, and do exactly what I was doing for all the schools from a central location. “It will be the ability to control our various systems within the district and make sure that all the information to be compiled and managed is where all the savings comes in.”

Metering

Gant said that metering “puts is all together. It correlates with the controls. Now that I can control my HVAC system, the metering piece allows me to gauge the actual costs associated with it. That’s the missing piece that allows us to say, ‘Alright, we’ve been in this room the last 50 minutes. How much will that cost us?’

“That’s what I’m most excited with. When I talk about being able to see what the actual costs are, it’s really the metering piece that’s going to allow us to do that. When we’re done with some of this summer’s work, hopefully what we’ll be able to do is when the community utilizes our facilities — a group has an event or a meeting — we will be able to tell those individuals or that community organization how much that has cost the district to host that event.

“At the end of the day, if the district takes that cost on, we will be able tell the community, ‘X amount of dollars were spent. This is what we have given back or this is what you paid for in these new buildings.” Gant said TPS will face two choices. The district can donate the utility costs of running an event as a way of investing back into the community or it can ask the organization using the building to pay for the utility costs associated with the building’s use.

“There are going to be some events that we’re going to say to the community, ‘We, the district, want to do this and pay that dollar figure.’ “There is also going to be a time when we say, ‘OK. If you want to utilize our building, this is how much it costs us to run it. This is how much we need to get paid in order for you to do what you need to do.

“We’ll deal with both. They’re certain things we do in the district that we’ll charge for and some things that from a community perspective, that are affecting our kids, that we’ll go ahead and pay for, like the use of school buildings as polling places, any Parent Teacher Organization function, some sporting events, proms and the May 18 chess tournament at Bowsher High School.

“The chess tournament is a good example. We will be able to say to the community, to our parents, ‘This is outside of the school day. These are some of the things that we do, and this is the cost associated with it, and this is an investment the district is making into your children — something you’re paying for as a taxpayer.”

Cost analysis

Gant said the cost analysis of building use was one of the recommendations in the Evergreen Solutions performance audit.

“It will really help us really define exactly how our buildings are utilized a lot better because now we can actually say, ‘This is the cost associated with it.’ And hopefully, it will help us charge appropriately as well as inform the community what we are doing,” he said. “Metering is going to allow us to do so much. So now we’re talking — and this is just my vision — about possibly going to the schools and having competitions about reducing energy use. We’re talking hopefully about some educational things that teachers may want to utilize from the curriculum side.

“There’s so many more things that we can do once we get all these things pieces in place — just to have a school recognize that if I do this, there might be a reduction in [cost and an increase in] savings, and that school could actually see that. It’s exciting from my perspective to get to a point where we can do that.”

Gant said the amount of energy used for lighting is also being reduced.

“We’re wanting to reduce the energy in order to produce the light, and there are certain bulbs — using LED (light-emitting diodes) bulbs to use instead of florescent and incandescent bulbs — and certain other things we can do from a lighting perspective to reduce our costs there.”

Gant said the other savings from the new system — one that was mentioned in the performance audit — was going from the hydraulic system [boilers] to the HVAC system. He said TPS will realize most of its savings in the utilization of the system.

“It’s knowing and having the ability to be able to control those settings when I know no one is in the building as well as being able to ascertain how well it’s performing. I don’t see the day-to-day temperature gauge being much different than what it is now. I don’t see that being the change that we would make. I see it as being able to change situations during the summer months or on a day off because of snow. I see the biggest advantage as being able to make a consistent change throughout the entire district if there are no people in that building. It would be a better way of doing things if we make sure we do the same things across the district when no one is in a building.”

School and community leader

Gant said he anticipates dramatic change in a relatively short period of time.

“I can definitely see, a year from now, that our conversation’s a little different now that we’ve moved on to the second phase. How we utilize it and how we’re able to show taxpayers or the schools some of the things I’m talking about.

“I think it will really happen that quickly. I don’t know what other folks are doing, but from what I can tell, I think we can be a leader in this area — in both schools and the community — for an institution this size. I’m looking forward to it. I see that as a challenge.”